Eurogroup marks start of 4th review and Greek debt relief discussion, Tsakalotos says

The Eurogroup on Monday marked the beginning of the fourth review of the Greek programme and the debate on Greek debt relief, finance ministry sources said on Tuesday.

Talking to the Athens-Macedonian News Agency (ANA), the sources highlighted two crucial dates:

– Monday, February 26, when the heads of the four institutions’ missions to Athens – Peter Dolman of the International Monetary Fund (IMF), Francesco Drudi from the European Central Bank (ECB), Nicola Giammarioli of the European Stability Mechanism (ESM) and Declan Costello from the European Commission – return to the Greek capital. It will be a visit of 3-4 days focusing on the agenda and timetable for the next meetings, as well as the course of the implementation of some of the most important prior actions. They are expected to come back after Easter for final negotiations.

– Thursday, March 1, when the results of the currently ongoing staff-level discussion on debt relief will be presented to the Eurogroup Working Group. The sources pointed to the specific references to debt relief made after Monday’s Eurogroup, both by Eurogroup President Mario Centeno and European Commissioner for Economic and Financial Affairs Pierre Moscovici, who pointed out that, as regards the debt, the goal is for a decision to be taken by the Eurogroup on June 21, which means that everyone should be in time for the Eurogroup in May.

All sides agreed that the third programme review has been concluded, the finance ministry sources noted. They pointed out that only two of the 110 prior actions are still outstanding — the former Elliniko investment and e-auctions – both of which are dependent on third parties (Council of State and notaries) for their implementation and not the government. It is estimated that both issues will be soon settled. The Eurogroup chief said on Monday that the two outstanding prior actions are outside the government’s control and it is estimated that, as soon as they are completed, the institutions will give the all clear for the disbursement of a 5.7-billion-euro loan tranche.

They also cited Centeno’s statement that the ball is now on the creditors’ side of the court, and that national procedures for approving the disbursement of the loan tranche should now take place, once the institutions validate the completion of pending prior actions.

According to ESM chief Klaus Regling, out of the total amount of 6.7 billion euros, 5.7 billion euros will be disbursed in the second half of March. Of this amount, 3.3 billion euros will be channeled to covering the country’s borrowing requirements for February-June, 1.9 billion euros for the creation of a cash buffer and 0.5 billion euros for the repayment of state arrears to the private sector. The remaining 1.0 billion euros is scheduled to be disbursed in due time but will be disbursed in April or May, after the state clears arrears of 1.0 billion euros and if the e-auction system is found to be operating smoothly. As Regling pointed out, the figures show that Greece had reached the December target for the repayment of state arrears to the private sector.